Is a condo or co-op right for you?
Condominiums and co-operatives offer different advantages
They may not get as much attention as freestanding houses, but the supply of condominiums and co-ops has outpaced the supply of single-family homes for the past year, according to the National Association of Realtors.
With so many condo and co-op units on the market, it makes sense for any homebuyers to give them a look. But what’s the difference between them, and which is right for you?
The Central Park Tower, center, is under construction, Tuesday, Sept. 17, 2019 in New York. At 1550 feet (472 meters) the tower is the world's tallest residential apartment building, according to the developer, Extell Development Co. (AP Photo/Mark L
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A condo is closer to a single-family home, but in a shared space. You own your condo and pay a homeowners-association-like fee to cover costs of common areas like lawn care, snow removal and elevator maintenance.
Condo buildings often have boards, but they’re typically less intense than co-op boards, which are notorious for drawn-out approval processes when an owner is looking to sell. Co-op rules and boards can also make it more difficult to rent out a unit than a condo.
Co-ops can be more intense because owners are buying a share of the corporation that owns the building, rather than a specific home. Owners also pay fees into a common pool, but they are usually higher than condo fees, also covering costs like taxes and, in some cases, utilities.
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Downtown Miami, Florida (iStock)
While co-ops typically charge higher monthly fees than condos, they usually are cheaper to purchase. However, they can require a higher-percentage down-payment.
Depending on where a homebuyer is looking, the difference may not even matter. Co-ops are most common in the Northeast, according to the U.S. Census Bureau. In many markets, condos will be the only choice.